For all those who are thinking of buying a house, here are the factors why a smart decision would be to opt for a joint housing loan. If you apply for a joint loan with a female co-applicant, you will benefit from concessional interest rates on home loans.
Is it necessary to apply for a joint home loan?
Although getting a co-applicant although applying for a home loan is not necessary for most situations, doing so has not one but many advantages. The reasons why opting for a joint home loan will be a smart decision for those who are looking forward to buying a property are listed below:
Increased total eligibility for loans
Insufficient revenue, poor credit score, high debt-to-income ratio, etc. often create barriers to authorizing the home loan application of the sole applicant. In such situations, opting for a joint loan will give the overall eligibility for the loan a massive boost. Your chances of loan approval are better when you add a co-applicant with secure wages, a good credit score, and adequate repayment potential.
When two or more individuals apply for a joint loan, each of them can enjoy, on a proportionate basis, tax advantages under the Income Tax Act in respect of the interest amount paid during the year.
Subsidy in interest rates for co-applicant females
If you apply for a joint loan with a female co-applicant, you will benefit from concessional interest rates on home loans. Lenders typically give female home loan borrowers a concessional interest rate, with an interest rate usually up to 5 basis points (0.05 percent) lower than the normal available interest rate.
Bear in mind, however, that certain creditors will require the woman to be both co-owner and co-applicant in order to benefit from the concessional interest rate. You can use the home loan interest calculator yourself to find out how much money you would eventually save if you opt for a joint loan.
Women Pay Lower Stamp Duty Charges
Signing up your land, as a sole owner or joint owner, in the name of a woman will help minimize stamp duty charges. Although stamp duty charges vary from state to state, some states typically provide women with 1-2 percent lower stamp duty charges.
Note that, under Section 80C, stamp duties, registration fees, and other expenditures directly related to the transfer of properties are liable to be claimed as tax deductions.
Avail Greater Tax Benefits
In compliance with Sections 80C and 24b, tax advantage can be used for both principal and interest repayment. Though principal repayment can be claimed up to Rs 1.5 lakh in a financial year, interest repayment for a self-occupied property can be claimed up to Rs 2 lakh in a financial year. Co-borrowers can claim these tax deductions separately when making use of a joint loan, provided they are also the co-owners of the house.Now, simply make use of the loan interest calculator to find out all the monetary benefits you and your partner are entitled to. You can also speak to a PNB Housing representative.
